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Software Pricing – Navigating the 30% Trap!
14 years ago

Software Pricing – Navigating the 30% Trap!

At a recent event for SafeNet Amy Konary made an interesting comment based on analysis performed by IDC. On average end users of enterprise software felt as though they utilized only 30% or so of the availability of that application. That is, they were not getting benefit from up to 70% of the software’s features and functionality. (Amy please forgive me if I don’t have those %’s exactly right but it was in that range) The conclusion reached from this observation is that software should be better dissected so that people only pay for the pieces they want.

The conclusion seems logical enough but I’ve struggled with it ever since. Firstly, if it’s true, why have rational economic buyers still purchased software en masse? Many financial analysts believe that software spending was one of the first sectors to bounce back from the recent economic turmoil.Secondly, are there any other normally functioning markets that have similar traits? Lastly, why do end users on average only use 30% of the available capabilities? Read More